The story sounds like something out of a novel — someone “finds” a next-gen iPhone housed in a 3G case on the floor of a bar in San Jose, and, while the phone was at first operational, alas, the unit now no longer boots. Those in possession of the unit send pictures to the editors at Engadget, who posted them last night. I was highly skeptical, to say the least. But: intrigued.

Today, Engadget has doubled down and called it legit, offering as proof this blurry photo they obtained back in January, which if you squint right appears to show this very device next to a test unit iPad. This photo isn’t conclusive, clearly, but I believe Engadget’s confidence in the legitimacy of this unit is based partly on factors they can’t publish.

So I called around, and I now believe this is an actual unit from Apple — a unit Apple is very interested in getting back. I am not certain that this looks like the actual production unit Apple intends to ship to consumers. I think it’s a testbed frame — thicker, with visible (un-Apple-like) seams, meant to fit in 3GS cases so as to disguise units out in the wild. It’s hard to tell from the photos. But I think it is the real deal in terms of the internals and display being next-gen iPhone hardware, and the new glass back. Put another way: the front looks legit, the back looks legit, but the sides I’m not sure about. A front-facing camera and 960 × 640 display are two things I believe are slated for the next iPhone. (The “80 GB” of storage sounds like a mistake to me, but who knows? SSD storage typically comes only in even power-of-two increments.)

The whole story is a bit fishy, to say the least. But, to reiterate, I believe Engadget’s photos do show a pre-production or testbed Apple iPhone unit. The fishy parts are where it came from, who leaked the photos and sold the unit, and who did they sell it to?